Kurt Emshousen is Chief Administrative Officer for Transwestern. Over the past 18 months, he has led an enterprise resource planning initiative which went live last month. In today’s conversation, Kurt discusses the scope and some of the challenges of the implementation.

Chris Saah: First, congratulations are in order. You’ve successfully completed your ERP implementation last month. How did it go?

Kurt Emshousen: Thanks Chris. Yes, we launched July 1st and ran our first payroll on the 14th. I am pleased to report that payroll and commissions were paid with very few issues. (We did have a hiccup with a file naming convention at one of our banks - a warning sign for other groups who have many multiple accounts through legacy arrangements, etc. Otherwise we are good to go!)

Chris Saah: Tell us some of the details.

Kurt Emshousen: We just completed implementation of Workday for Finance, Payroll and HCM. Our next phase will include Budgeting and Planning, Performance Management and Compensation. The value for the organization is simple: Transwestern gets to replace over 15 legacy systems with a world class ERP that creates a foundational platform for integrating our other applications and creates a true universal data model for better execution and extensive business intelligence.

Chris Saah: And CRM is a part of that as well, isn’t it? I understand you’ve automated the payment of broker commissions.

Kurt Emshousen: We also just implemented a rollout of Microsoft Dynamics 365 (CRM) including a commission calculation engine integrated with Workday to streamline broker payments and customer billings. The ability to integrate commission calculation directly into Workday will speed up our commission payment process and generate significant amounts of deal data to better serve our clients.

Chris Saah: This isn’t your first time with an ERP rollout. Tell us about the organizational and process challenges you have faced and how you dealt with them.

Kurt Emshousen: Interestingly, most companies start with determining their old technology is struggling to keep up and they need to implement an ERP. What I have always found is that companies need s need to update their processes first and foremost, but they need technology to be able to execute. What every company that undertakes such a challenge understands quickly is that everything about the old way they did business will likely change. They need to be ultimately prepared for the greatest change management challenge they’ve ever faced.

Any company looking to make this commitment should plan to take 12-18 months to thoroughly document their desired future state before selecting an ERP and beginning the design process. This is a key to wringing value from the investment, knowing what you want to accomplish and designing everything to meet that objective. Another important - albeit painful side effect - is some people in the organization aren’t always ready for the change. Some figure it out and become champions of the new processes and find their careers are catapulted as they embrace change and help thrust the company forward. Others cannot shake the way things used to be and feel left behind. This is the most difficult part of the change management process and requires close monitoring by the Human Resources department to ensure these scenarios are handled appropriately. Change can be exciting and rewarding, the first step is being willing to give up the old ways of doing things.

Chris Saah: This represents a significant shift in mentality from build to buy and on-premise to cloud. Can you tell us more about your overall cloud strategy?

Kurt Emshousen: With Workday being a SaaS only product, this paved the way for us to also move to Dynamics 365 in the cloud and, at that point, we ultimately realized we could significantly benefit from a platform that invested more in aggregating the best technology into a platform that helps our team win, than spending resources on managing the basic capabilities. We hear a lot about the move toward SaaS and PaaS and Infrastructure as a service; we knew Transwestern was uniquely positioned to truly make the move to the cloud and reshape the technology of our organization into a dedicated group of business analysts who solve problems for our employees and our clients.

One of the best financial benefits is that our technology spend will become more ratable. We pay subscriptions for licensing software and our cost is directly proportionate to our headcount, which keeps us accountable for managing our resources effectively to save money in all aspects. With the emergence of the large cloud providers, AWS, Azure and others, we are starting to see costs fall and service improve and our team’s focus is on connectivity and value-added technology - not just the basics. This will prove, over time, to differentiate Transwestern and provide our clients with greater value as a greater portion of our resources are dedicated to their needs as opposed to administrative tasks.

Chris Saah: This is a milestone accomplishment in itself, not to mention the beginning of your journey to the cloud. We’ve run out of time today, but I would like to revisit this initiative and go deeper into some change management and process challenges you have faced and how you overcame them.

Kurt Emshousen: Sounds great. I’d be glad to.

Out of the Trenches is an occasional series of interviews conducted by Chris Saah of TecFac. It features in-depth and timely conversations with commercial and corporate real estate technology leaders on their successes, challenges and insights into running a CRE IT team as well as trends they see in the industry.

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